Mandatory reserves rate reduced by one percent

BELGRADE - The Executive Board of the National Bank of Serbia (NBS) decided on Thursday to reduce the rate of mandatory bank foreign exchange reserves from 28 to 27 percent for funding sources with the maturity date of up to two years, and to cut the rate from 21 to 20 percent for bank funding sources with the maturity date of over two years.

At the session, NBS Executive Board also adopted the decision to change the structure of mandatory allocations by raising the part of dinar-denominated mandatory foreign exchange reserves by two percent. Thus, the dinar-based allocations for mandatory foreign currency reserves now total 36 percent for funding sources with maturity dates of up to two years, or 28 percent for funding sources with the maturity date of over two years.

In the release, NBS said that in this way, the central bank will make it possible for banks to provide better loan support to the economy and reduce the expenses for loans granted to companies.

The aim of this measure is to stimulate bank loan activities through additional decrease of mandatory foreign currency reserves, lower costs for the mandatory reserves and freeing a part of loan potentials by the rate reduction.

Photo Tanjug, M. Jelesijevic (archive photo)